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'Give and take' for free trade deal

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Newtown-Fella
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« on: November 17, 2009, 04:41:57 am »

New Zealand faces tough choices and must be prepared to make concessions to win a free trade deal with the United States, Prime Minister John Key says.

A trade deal with the world's biggest economy is a real possibility after US President Barack Obama signalled the Trans-Pacific Partnership (TPP), linking New Zealand, Singapore, Brunei and Chile, would be the vehicle for a broad Asia-Pacific free trade bloc.

There are potentially big benefits, especially for Fonterra and other dairy exporters, in bringing the US into the bloc. It would effectively deliver the bilateral deal that New Zealand has sought for 20 years, and could be better than a one-on-one deal negotiated by Australia.

But it would not be all one-way traffic, Mr Key said. The US would have its own "shopping list" that was likely to include changes to the way state drug-funding agency Pharmac operates.

It uses bulk-buying and access to generic medicines to keep prices down, reducing potential profits for the big US drug companies.

"You can't rule out Pharmac – it has been on the list before. You can't rule out issues of intellectual property and investment. All of those things will inevitably be part of the negotiations," Mr Key said.

"But I would be surprised in the final analysis if we were to walk away with a potential FTA of such high quality with the United States because we weren't prepared to give a bit on the odd area."

June Tordoff, a senior lecturer in pharmacy at the University of Otago, said Pharmac had done a good job of keeping pharmaceutical costs down since it was set up in 1993. That could change if its controls were loosened.

"I think the problem could be that if we did loosen up Pharmac's control of the whole system we could end up having to spend a whole lot more on medicines, and we need to decide if we can afford that."

Fonterra chairman Henry van der Heyden said the possibility of a free trade deal with the US was exciting. "It's early days but it's great to see that the US is engaging."

It was too soon to tell how much a deal might be worth to New Zealand's dairy industry.

Mr Key has accepted an invitation to visit the White House next year, possibly in April. Trade talks are expected to be high on the agenda.

A deal could be achieved by 2011, when Mr Obama would host the Asia-Pacific Economic Co-operation summit in Hawaii, Mr Key said.

Progress on trade at the Apec summit in Singapore was not matched by agreement on climate change, ahead of the UN summit in Copenhagen next month, after pressure from China forced a significant weakening of the final declaration.

The communique was expected to aim for a 50 per cent reduction in greenhouse gases by 2050, or at least commit to keeping temperature rises to 2 degrees celsius.
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But the final wording contained no targets and referred only to a 2007 goal to cut energy intensity – the amount of energy used for each unit of output in the economy – by 25 per cent by 2030. It said Apec countries would work "towards an ambitious outcome in Copenhagen".

http://www.stuff.co.nz/dominion-post/politics/3068575/Give-and-take-for-free-trade-deal
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charlie
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« Reply #1 on: November 17, 2009, 07:22:02 am »

Sounds like a warm up to the bulk sell off of community owned assets. Why doesn't Key tell us what is off the agenda.
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guest49
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« Reply #2 on: November 17, 2009, 07:38:17 am »

I suppose there will be advantages, but why is this such a big deal?
America is slowly becoming a spent force - by the time we have access in a decade or two, it wont be worth having.
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